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IP/97/278

Brussels, 9 April 1997

COMMISSION SUPPORTS RECONVERSION IN 8 ITALIAN REGIONS IN INDUSTRIAL DECLINE

A number of Italian regions in industrial decline (so-called obj. 2 regions) are to receive about Ecu 720 million from the EU’s Structural Funds to cope with industrial and structural change. The aid comes under a set of programmes approved in principle by the European Commission today, and is to go to the following regions: Piemonte, Valle d’, , , Friuli- Venezia Giulia, , and .The overall expected employment impact is the creation of about 8,000 new jobs and the safeguarding of around 70,000. Structural Fund aid will be matched by public and private sector expenditure to bring the total investments to about Ecu 2 billion.

General characteristics of the areas

The areas designated for support, although all characterized by a continuing decline in their manufacturing base, are very different in terms of socio-economic situation. In general, two main groups can be distinguished:

1, Traditional industrial areas, characterised by the presence of large firms and declining traditional industries (Valle d’Aosta, Liguria, Friuli-Venezia Giulia, Umbria and Veneto and Piemonte in part). A steady reduction in the number of large enterprises, only in part compensated by labour market flexibility and the SME network, has worsened socio-economic cohesion in these areas. The cities and urban areas concerned (, , , , Terni) are characterised also by high unemployment rates, environmental problems, a large concentration of derelict and contaminated sites and decaying districts with high levels of crime.

These areas do however benefit from the presence of important scientific and technological institutions, good transport infrastructures, services to SMEs and, last but not least, good tourism potential. These assets offer concrete opportunities for diversification.

2, SME areas (, Marche and parts of Veneto and Piemonte), with a strong presence of SMEs. The latter are often more exposed to economic fluctuations than larger firms. They also face greater difficulties in raising external finance, penetrating overseas markets and acquiring management and other key skills. Flexibility and increasing SME internationalisation are strategic opportunities which risk being lost due to poor performance in terms of innovation, poor workforce qualifications and a scarcity of quality services for SMEs. The strategy of the eight regions for the coming three years have many common elements. An outline of the main priorities of the programmes is given below:

Development and strengthening of SMEs. The need to promote both new business start-ups and to support existing companies in upgrading their productive structures through investment programmes has been recognised by all the regions as being of paramount importance. Accordingly allocations of between 25 to 55% of the regions’ resources have been attributed to this area alone. Support will take the form of a range of financial incentives - grants, participating loan schemes and venture capital funds - all of which are aimed at facilitating access to capital resources for SMEs. Inward investment and promotion of business internationally are other areas focused upon. An example of such promotion is the agency being set up in Piemonte for the international promotion of the region and the city of Turin. On the training side, initial counselling on new business start-ups will be offered to would-be entrepreneurs.

Innovation and technological transfer. Funding will be made available for research programmes developed by consortia comprising private companies and research institutes. A consortium of this kind has been set up with the Parco Scientifico e Tecnologico della Liguria to encourage the pooling within Liguria of research. The universities, polytechnics and research institutes of several other regions will similarly be involved. SMEs will be eligible for grants for research into new products and processes. Provision of resources for the setting up of so-called incubator units and for the dissemination of information and advisory services on the Information Society and network services completes the sectors targeted for financial support in the area of research.

The environment and sustainable development. Support will take the form of financial incentives to firms investing in technology relating to the collection, disposal and/or recycling of dangerous substances and to public bodies for the installation of environmental infrastructure for the disposal of industrial waste. Industrial waste water treatment is another sector to receive funding in some of the regional programmes. Urban regeneration of industrial and urban wasteland for future productive use is another aspect of the environment to receive funding.

Tourism. Several regions have linked tourism to measures for the revitilisation of urban centres. The renovation of historic town centres through a coordinated set of interactive measures are foreseen by many of the regions. Such measures may involve the renovation of buildings for use as cultural recreational or sports’ centres or the grant of aid to commercial or craft firms so that the reopening of small business and craft workshops can help to revitalise a given area.

2 With regard to transport, Liguria and Veneto are providing funding for the development of the port areas of Genoa, and and Venice respectively. Schemes include the realisation of infrastructure and telecommunication networks to facilitate and rationalise the movement of both goods and people. In the case of Venice a new passenger terminal is planned. Grants to support SME investment in the four ports will also be provided. A new measure in the Friuli Venezia-Giulia programme is intended to provide solutions to traffic problems in the conurbation of Trieste while in the Marche region a road and rail transport centre and service site for road haulage businesses will receive funding.

Local employment initiatives. Responding to the Commission’s recent promotion of territorial pacts, the region of plans, together with the provincial administrations, to identify a number of new areas sharing similar socio-economic characteristics and high unemployment and to put in place integrated projects which will promote the development of SME infrastructure projects in the local economy.

Training covers a wide variety of sectors and beneficiaries. Training targeting the staff of large enterprises, public and private, will put special emphasis on planning techniques, organisational skills, production processes and quality control. Special training wil be offered to public and private research centres conducting innovative projects capable of advancing work in the fields of energy saving, telecommunications and transport.

The breakdown of investment and Structural Fund allocation is the following:

Ecu million Total Funding EU funding (including EU, national and private investment)

Region Piemonte 972 309 Liguria 339 129 Veneto 303 107 Umbria 141 53 Friuli-Venezia Giulia 108 39 Lombardia 88 34 Marche 86 31 Valle d’Aosta 30 13

Final approval of these programmes is expected for May 1997.

3 The following authorities are responsible for the implementation of the programmes:

Regione Piemonte Regione Liguria Piazza Castello 165 Via Fieschi 15, I-10122 TORINO I-16121-Genova tel. no.0039/11-4321300 tel. no.0039/10-5485437 fax no.0039/11-4324792 fax no.0039/10-5704211

Regione Veneto Regione Umbria Palazzo Gussoni - Cannareggio 2277 Via Fontiveggia 55 30121 VENEZIA- Italia I-06124 tel. no.0039-41-2793200 tel no. 0039/75-5041111 fax no.0039-41-2793201 fax no. 0039/75-5044695

Regione Friuli-Venezia Giulia Regione Lombardia via S. Francesco 37, Via Sassetti, 32/2, I-34132 Trieste I-20214 MILANO tel. no.0039/40-637872 tel. no.0039/2-67656230 fax no.0039/40-3775025 fax no.0039/2-67656337

Regione Marche Regione Valle d’Aosta Via Tiziano 44 Piazza Deffeyes 1 60125 111000 AOSTA tel.0039/71-8063249 Tel. 0039/165-238181 fax 0039/71-8063220 Fax 0039/165-31373

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